Shanghai shares seen recouping 2011 losses this year

Shanghai's main share index is likely to rise by almost a quarter this year, recouping 2011's losses, as revised earnings growth expectations and looser monetary policy produces the first annual gain in three years, a Reuters poll of market strategists showed on Thursday.
The Shanghai Composite Index, currently up around 2 percent so far in 2012, is seen rising to 2,725 by year-end, up 21 percent from Thursday's close of 2,252.16, according to the median forecast of 18 strategists polled over the past week.
This compares to the 12 percent gain in 2012 so far on Hong Kong's Hang Seng Index, seen as a key offshore Chinese market, with retail investors wary after two straight annual losses have shaved a third off the index. Prices have stayed low as a result. According to Thomson Reuters I/B/E/S data, A-shares listed in Shanghai are currently trading at 9.5 times forecast earnings, a 75 percent discount from its all time high recorded in October 2007.
Mainland Chinese markets are largely closed to foreigners and dominated by domestic retail investors, which by some reports are responsible for 60 to 70 percent of market turnover.